Metso publishes carve-out and pro forma figures for Valmet Corporation for January-September 2013
Metso Corporation's stock exchange release on November 12, 2013 at 2:00 p.m. local time
Metso's Extraordinary General Meeting approved a demerger plan on October
1, 2013, pursuant to which Metso's Pulp, Paper and Power businesses will
transfer, without liquidation, from Metso to Valmet Corporation. The completion
of the partial demerger is expected to be registered in the Finnish Trade
Register on or about December 31, 2013. The trading of Valmet's shares on NASDAQ
OMX Helsinki is expected to commence on or about January 2, 2014.
Carve-out and pro forma key figures and essential accounting principles for
Valmet are shown below. More extensive information can be found in the
attachment.
Valmet's Carve-out Financial Information
The interim carve-out financial information for the nine month period ended
September 30, 2013 has been prepared by combining the income statements,
comprehensive income statements, balance sheets, and cash flows of the legal
entities and operating units attributable to the Pulp, Paper and Power
businesses in Metso's historical consolidated financial statements and that will
be carved out from Metso to form the Valmet Group. This includes the income,
expenses, assets, liabilities, and cash flows of certain overseas holding
companies owned by the Parent Company and Metso that will either be transferred
to Valmet or that have been allocated to Valmet for the purpose of preparing the
carve-out financial statements and interim carve-out financial information. As
the Valmet Group does not comprise a group of entities under the control of a
parent as defined by IAS 27, "Consolidated and Separate Financial Statements",
consolidated financial statements for the businesses have not been prepared
historically for internal or external reporting purposes.
The interim carve-out financial information for the nine month period ended
September 30, 2013 has been prepared in compliance with the recording and
valuation principles of the IFRS standards as adopted by the European Union and
take account of, the accounting basis and accounting principles used in
preparing the carve-out financial statements for the years ended December
31, 2012, December 31, 2011, and December 31, 2010 and the carve-out financial
information for the six month period ended June 30, 2013.
The interim carve-out financial information is unaudited and should be read
together with the audited carve-out financial statements for the years ended
December 31, 2012, 2011, and 2010 together with the unaudited carve-out
financial information for the six month period ended June 30, 2013 included in
the demerger prospectus dated September 20, 2013 and released on September
23, 2013.
As at and for the As at and for the As at and for the
nine months ended nine months ended year ended
KEY CARVE-OUT DATA September 30, 2013 September 30, 2012 December 31, 2012
(EUR in millions)
Net sales 1,946 2,089 3,014
EBITA before non- 78.8 138.8 192.0
recurring items
% of net sales 4.1 6.6 6.4
Operating profit 7.0 116.4 138.3
% of net sales 0.4 5.6 4.6
Non-recurring items:
Capacity adjustment
expenses
in cost of goods sold -21.9 - -8.5
in selling, general and -9.2 - -2.1
administrative expenses
in other operating -15.1 - -13.1
income and expenses, net
Cost related to demerger
process
in selling, general and -5.6 - -
administrative expenses
Total non-recurring -51.8 - -23.7
items
Amortization -20.0 -22.4 -30.0
Depreciation -43.0 -44.1 -59.5
Gross capital -44 -41 -64
expenditure (including
acquisitions)
Non-cash write-downs -27 -4 -17
Capital employed 1,155 1,324 1,290
Orders received 1,754 1,767 2,445
Order backlog at end of 1,658 2,534 2,249
period
Valmet's Pro Forma Financial Information
Basis of Compilation of Unaudited Pro Forma Financial Information
The following unaudited pro forma financial information is presented to
illustrate the financial impacts of the demerger and certain transactions
related to the formation of Valmet on Valmet's results of operations and
financial position had the demerger taken place at an earlier point in time.
This unaudited pro forma financial information is presented for illustrative
purposes only. Because of its nature, this unaudited financial information
illustrates what the hypothetical impact would have been if the demerger and
certain transactions related to the formation of Valmet had taken place at the
dates assumed in the pro forma financial information and does not represent
Valmet's actual results of operations or financial position. This financial
information is not intended to project Valmet's results of operations or
financial position for any future period or as at any future date and does not
represent the results of operations or financial position had Valmet been an
independent publicly traded company during the periods presented. In addition,
it should be noted that the corporate headquarter costs allocated to Valmet for
historical carve-out purposes may not necessarily represent what these costs
would have been if Valmet had operated as an independent legal entity.
Additional costs may be incurred by Valmet following the effective date to
enable it to operate as an independent listed company and as a result of
reorganizing its administrative and headquarter functions.
The pro forma adjustments are based upon available information and assumptions,
which are described in the accompanying unaudited pro forma notes. There can be
no assurance that the assumptions used in the preparation of the unaudited pro
forma financial information will prove correct.
The pro forma adjustments that have been made to reflect the effects of the
demerger and certain transactions related to the formation of Valmet are based
on Valmet's unaudited interim carve-out financial information as at and for the
nine months ended September 30, 2013, unaudited carve-out financial information
as at and for the year ended December 31, 2012, and management's estimate of the
transactions that have been completed or are to be completed to effect the
demerger and form Valmet in accordance with the demerger plan. The final amounts
of assets and liabilities transferred to Valmet in the demerger may materially
differ from those presented in the pro forma financial information, as such
balances will be determined on the effective date. This could result in a
significant variation from the results of operations and financial position
presented for Valmet in the pro forma financial information.
Pro Forma Periods
The pro forma statement of income and pro forma statement of comprehensive
income for the year ended December 31, 2012 and for the nine months ended
September 30, 2013 have been compiled assuming that the demerger and certain
transactions related to formation of Valmet had been completed on January
1, 2012, while the pro forma balance sheet as at September 30, 2013 has been
compiled assuming that the demerger and certain transactions related to the
formation of Valmet had been completed on September 30, 2013.
The pro forma financial information presented here should be read in conjunction
with the unaudited carve-out financial information for the nine month period
ended September 30, 2013, the historical carve-out financial information for
Valmet, and other information included in the demerger prospectus mentioned
above.
As at and for the nine As at and for the year
months ended September ended December
30, 2013 31, 2012
KEY PRO FORMA DATA (unaudited)
(EUR in millions, unless otherwise indicated)
Net sales 1,946 3,014
Operating profit 13 122
Profit before taxes 8 118
Amortization -20 -30
Depreciation -43 -60
Non-recurring items:
Capacity adjustment expenses
-46 -24
Costs related to the
demerger 0 -16
EBITA((1)) 33 152
EBITA before non-recurring
items((2)) 79 192
% of net sales 4.1 6.4
Earnings per share,((3))
EUR 0.04 0.52
Shares (outstanding shares
of Metso as at September
30, 2013) 149,864,206 149,756,034
Balance sheet total 2,427 n/a
Equity 824 n/a
Interest-bearing liabilities
207 n/a
Net debt 4 n/a
Net gearing,((4)) % 0.5 n/a
ROCE before taxes,((5)) %
2.5 n/a
ROCE after taxes,((6)) %
2.2 n/a
Equity to asset ratio,((7))
% 40.8 n/a
___________
(1) EBITA = operating profit + amortization
(2) EBITA before non-recurring items = operating profit + amortization + non-
recurring items
Profit
(3) Earnings per share =-------------------------------------
Number of outstanding shares in
Metso
Net interest-bearing liabilities
(4) Net gearing =-------------------------------------x 100
Total equity
Profit before taxes + interest and
Return on capital employed other financial expenses
(5) (ROCE) before taxes =-------------------------------------x 100
Balance sheet total - non-interest-
bearing liabilities
Profit + interest and other
Return on capital employed financial expenses
(6) (ROCE) after taxes =-------------------------------------x 100
Balance sheet total - non-interest-
bearing liabilities
Total equity
(7) Equity to asset ratio =-------------------------------------x 100
Balance sheet total - advances
received
Disclaimer
This release does not constitute an offer to sell or a solicitation of an offer
to buy any securities in any jurisdiction. In particular, no securities are
being offered or sold, directly or indirectly, in or into the United States
pursuant to this release and no shares or other securities of Valmet have been,
or will be, registered under the U.S. Securities Act of 1933, as amended (the
"Securities Act"), or under the securities laws of any state of the United
States and, accordingly, may not be offered or sold, directly or indirectly, in
or into the United States, unless registered under the Securities Act or
pursuant to an exemption from the registration requirements of the Securities
Act and in compliance with any applicable state securities laws of the United
States.
The distribution of this release may, in certain jurisdictions, be restricted by
law. This release may not be sent to any jurisdiction in which it would not be
permissible to do so.
This release includes forward-looking statements within the meaning of the
securities laws of certain applicable jurisdictions. These forward-looking
statements include, but are not limited to, all statements other than statements
of historical facts contained in this release, including, without limitation,
those regarding the demerger plan and its execution. By their nature, forward
looking statements involve known and unknown risks, uncertainties and other
factors because they relate to events and depend on circumstances that may or
may not occur in the future. Metso cautions you that forward-looking statements
are not guarantees of future performance and are based on numerous assumptions
and that Valmet's actual results of operations, including its financial
condition and liquidity and the development of the industries in which Valmet
and the members of its group operate, may differ materially from (and be more
negative than) those made in, or suggested by, the forward-looking statements
contained in this release.
Metso's pulp, paper and power professionals specialize in processes, machinery,
equipment, services, paper machine clothing and filter fabrics. Our offering and
experience cover the entire process life cycle, including new production lines,
rebuilds, and services.
As of January 2014, Metso's Pulp, Paper and Power business will serve its
customers with an even more focused and competitive approach as an independent,
listed company, Valmet Corporation.
Metso is a global supplier of technology and services to customers in the
process industries, including mining, construction, pulp and paper, power, and
oil and gas. Our 30,000 professionals based in over 50 countries contribute to
sustainability and deliver profitability to customers worldwide. Metso's shares
are listed on the NASDAQ OMX Helsinki Ltd.
www.metso.com, www.twitter.com/metsogroup
Further information, please contact:
Markku Honkasalo, CFO, Future Valmet Corporation, tel +358 20 484 100
Metso Corporation
Harri Nikunen
CFO
Juha Rouhiainen
VP, Investor Relations
Distribution:
NASDAQ OMX Helsinki Ltd
Media
www.metso.com
